Defining an Entry Strategy into the Logistics Infrastructure Space for One of the Largest Infrastructure Players in India
The client, one of the leading infrastructure players in the country, was evaluating catering to the booming logistics sector by providing infrastructure to logistics players. The client requested UC to identify the infrastructure segment that they should focus on and the entry strategy for the same.
To identify a suitable segment and to define the entry strategy, UC adopted the following approach:
- Landscaped the logistics industry and shortlisted key segments for detailed analysis vis: break bulk, dry bulk and cold storage
- Met key customer segments to analyse the potential for an organised infrastructure provider
- Analysed key requirements of customers related to location presence, terms of arrangement (period of lease etc.), specifics of storage facilities required (e.g. height specifications, racking systems etc.)
- Identified key corridors where such facilities need to be established, taking into account the impact of the common services tunnel phase-out, the connectivity of the various locations to the national highways and other transport infrastructure and aggregate nodes
- Evaluated the economics of different business models (Pure play infrastructure, infrastructure with services, infrastructure and logistics, etc.)
- Prepared indicative financials covering capital investment, return on capital employed, internal rate of return for the business etc.
The client received a detailed understanding of the logistics industry, along with a business model and the financials of the segment that UC recommended they focus on.